The concept of being "blinded by the light" is a factor in the failure of some organizations to change, and the resulting loss of marketing position to competitors. Learn the general nature of mental mapping mistakes, and how to overcome them.

This chapter is from the book

Introduction

Just imagine that the sun is shining, its rays shimmering off the ocean waves
as they lazily break on a smooth, sandy beach. A friendly breeze occasionally
rustles the palm trees. You are on the beach because you've done it the
old-fashioned wayyou've earned it. You've worked hard;
you've been smart. You've come up with new technology. You've
made your company one of the most recognized in the world. You've pioneered
what would turn out to be one of the hottest management concepts of the late
twentieth century6 Sigma.1 You are
touted in the press as one of the most admired companies. You are the market
leader in what is expected to be one of the largest consumer market products
everthe mobile phone. When it was unveiled, your StarTac phone was the
coolest phone to own. You are Motorola.

You are doing the right thing and doing it well. This was the case for
Motorola from the late 1980s and into the early 1990s. Its analog phones were
the phones to own.

But then the environment shiftedradically. First, a new digital
technology for mobile phones came along. However, at first it was not clear how
superior the sound would be. In addition, the new digital technology would
require new and expensive infrastructure. On top of that, most of
Motorola's other U.S. competitors did not seem as though they would make a
quick move to the new technology. The one competitor committed to the new
technology was some small little company in frozen Finland, a country with a
total population of less than that of Manhattan during the day. Besides, no one
was really sure how to pronounce the company's nameNokia. Was it
No?-kia (with the emphasis on the "No") or No-kia? (with the emphasis
on the "kia")? And what does a company that has been in the forest
products business for over 100 years and excels at making rubber boots for
fishermen know about high tech? So what if Nokia went with this new digital
phone? So what if countries in Europe adopted this new digital standard? Any of
those individual countries, such as Germany or France, paled in comparison to
the market size of the United States.

The result? Motorola's first reaction was to deny that this new
technology or competitor was anything to worry about.

But then Nokia's revenue increased fourfold, from $2.1 billion in 1993
to $8.7 billion in 1997. All of Europe adopted a common digital standard that
allowed people to use their mobile phones virtually anywhere in the region. This
convenience drove even greater demand. In the meantime, the fragmented standards
of the United States meant that one phone would not necessarily work in every
state.

What did Motorola do? Oddly enough, it put even more investment and effort
into its analog phones. It did what it knew how to dowhat it was good
atand it did it even more intensely than before.

Well, we all know what happened. Motorola's share of global mobile phones
dropped from about 35% to just under 15% by end of 2000. Nokia, virtually unknown
in the United States in the early 1990s (or most of the rest of the world, for
that matter) has become one of the top 5 recognized brands in the world just
after GE and before Intel. In 2000, nearly 70% of all mobile phone handset profits
went to Nokia, with a market share of around 35%. That's right: Nokia's
"profit share" was double its "market share."